A redemption fee is a 1 to 6 percent charge that shareholders pay when they withdraw their investment from a mutual fund.

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A redemption fee is indeed a charge that investors pay when they redeem their shares in a mutual fund, typically ranging from 1 to 6 percent of the value of the shares being redeemed. This fee is meant to discourage short-term trading and help offset the costs incurred by the mutual fund company when investors buy and sell shares frequently. However, not all mutual funds impose a redemption fee, and the amount and duration of the fee can vary across different funds.

A Redemption Fee Is a 1 to 6 Percent Charge